Vodafone poised to cut 500 jobs at Newbury headquarters

Vodafone is set to announce up to 500 job cuts at its Newbury headquarters.

The mobile phone company, which was founded in Newbury in 1982, has about 3,000 staff in the Berkshire market town after cutting staff over recent years to bring down costs.

It shed 500 UK staff last year, mostly in Newbury, but also created new jobs in its retail and internet operations.

As part of a new £1 billion cost-cutting programme, announced last year, Vodafone will reduce the number of people working for the company’s UK operation in areas such as back-office functions and middle management. It has already moved to reduce the number of managers it employs in the UK after making its director of consumer sales and retail director redundant as part of a wider shake-up of its consumer business.

Vodafone, which declined to comment on its plans, is synonymous with Newbury and remains by far the market town’s largest employer. The company began as an offshoot of Racal, the electronics group, when it employed fewer than 50 people in one building. The company quickly grew to become a global giant as mobile phone usage boomed over the next two decades. At its peak in 2000, when it bought Mannesmann, the German group, it employed 3,500 workers across 62 buildings in the town, which struggled to accommodate the company. Chris Gent, its chief executive at the time, famously had an office over a curry house.

With a population of only 27,000 at the time, Newbury came to be known as “Vodafone City” and despite at one stage threatening to move to nearby Reading or Swindon, the company maintained its foothold in the area after building a large headquarters on the outskirts of Newbury.

The town has benefited hugely from the company’s growth and, like other towns in the M4 corridor, such as Bracknell, Swindon and Reading, is synonymous with the high-tech sector. Newbury is one of the most expensive places to buy a house outside London, with an average price of nearly £210,000, almost £50,000 higher than the national average.

Despite Vodafone’s cost-cutting, Newbury is not a town in decline. With unemployment below the national average at 4 per cent and significant investment going into new projects, Newbury has not been as hard-hit as other areas of the country that are tied to a large employer. A new seven-screen cinema complex opened in November and a £160 million shopping centre, funded by Standard Life, is due to open this spring.

Plans for an upgrade of Newbury Racecourse have also been approved, which will provide a boost to the local economy.

Peter Atkinson, who sits on the Thames Valley Chamber of Commerce Council, told The Times: “You get the feeling that we have escaped the recession. We started off in a good position and maintained that impetus.”

Newbury profile

Population: 32,500 Employment rate: 84 per cent, which is above the national average, while unemployment is 4 per cent. Ninety-one per cent of males are economically active, above the national average of 83 per cent.

Deprivation: Newbury is the 24th least deprived area in the UK Housing: Average house price in 2009 was £209,750, compared with £155,855 for England and Wales Average earnings: £610.30 weekly against £479.30 UK average (2008)

Employment (2007): Manufacturing — 12 per cent, Construction — 5 per cent, Hotels and restaurants — 25 per cent, Finance and IT — 26 per cent. Thirty-three per cent of people work in knowledge-driven sectors, compared with a national average of 23 per cent.

Largest employers: Vodafone, 3,000 staff; Bayer, 1,250; West Berkshire Council, 1,824

Nic Fildes, The Times 09-03-2010